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tv   Bloomberg Business Week  Bloomberg  June 10, 2017 7:00am-8:01am EDT

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carol: welcome to bloomberg businessweek. i'm carol massar. oliver: and i'm oliver renick. carol: this week, some twitter advice for president trump. oliver: a look inside a brazilian construction giant, more specifically, the department of bribery. carol: and why buzzfeed claims to be king of online video. oliver: all that ahead on "bloomberg businessweek." ♪ carol: we're here with the editor in chief of "bloomberg businessweek," megan murray. you spoke with tom barrick. megan: tom barrick is a legendary financier, head of colony capital.
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he has also become very well-known for being one of president trump's fiercest economic advisers. he is one of the first people to come forward from the financial community to become one of his most prominent backers, did fundraising for him very early, and was consistently during the campaign one of his most public surrogates in making the economic case for donald trump. he said this man is my friend, he is a dealmaker, he is going to be a different kind of president. he is going to get things done. it was a great opportunity last night, during the opening we are seeing in the first six months, to take his temperature on how he thinks the president has done. oliver: he said he would not give him a grade yet, that is like asking before the semester is over. megan: he asked to take a sabbatical, specifically, on giving a grade. oliver: one thing i thought was interesting is that he views the trump presidency as disruptive in the way uber and amazon is to the corporate world. those were his exact words. megan: that was the first time i ever heard that phrase, and he
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was specifically referring to how he conducts his social media strategy. one thing we talked extensively about was his use of tweets. now many of us expected him to stop that, take on a more presidential tone. we have seen exactly the opposite, in fact. in the last few weeks, specifically, we have a tweet about the terror attacks in london, which were very controversial. tweets about saudi arabia, and the escalation of diplomatic tensions in the middle east this week. i think i really wanted to hear what tom had to say about that, and he said the tweets do drive everyone crazy, but donald trump has harnessed social media in a way no other public figure has, no company has been able to do, and that is really the heart of much of his effectiveness. the argument he was making with the presidency is that through the chaos, he will chip away at the establishment. the establishment longer serves the american people, and this
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period of chaos right now, whether it is the tweeting, the lack of agenda, even the absence of so many positions in government, there is a method to this madness, and it is slowly eroding people's beliefs, people's ties to the establishment, including in washington. at the end of this process, the president will be able to come through and make things happen. whether you believe that or not is up to you, but that was the argument tom was making last night. oliver: let's talk about the cover story, corruption in brazil. megan: there are two numbers that put this corruption scandal involving this giant construction company and the giant construction company, and the long-running brazilian scandal. $788 million in bribes, and $3.2 billion tied to the construction company, this is a scandal, a level of bribery and graft, on an institutional level, about how they carry this off, years and decades, part and parcel of
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the company's success, and we went behind and stripped it all back, and showed you how it all began. carol: we have more from reporter mike smith. mike: this company is the biggest construction-engineering firm in latin america. it is one of the biggest in the world, bigger than bechtel. it grew over the years, basically on the back of paying bribes all over the americas, and even into africa, in order to get sweetheart deals on contracts. carol: was it just a part of doing business? how did it get to the point where bribery was such a part of doing business at this company? mike: in this case, all the top execs have been arrested, and they have agreed to testify in exchange for a plea agreement. they described a history of at least 30 years, this company is almost 100 years old, where this is basically the way business was done.
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in order to get contract or government work, you have to spread money around to the politicians, you have to do this or that with illegal money. at least that is what they say, so it became part of the culture of odebrecht, in order to get the government deals, and of construction companies in brazil, which was revealed in the broader case. carol: do they have to do bribes to get those contracts? without it, would they have not gotten the business? mike: that is what they say, but it is like what came first, the chicken or the egg? it is part of the culture. it probably always has been, and the point is that they paid bribes, and what they got in return were massive profits they probably would not have gotten if they had not paid off people. the contracts they got were way overvalued, which in turn has simply cost the brazilian people in the country lots of money that they could've spent on things like helping the poor, and fixed brazil's massive
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problems. oliver: the net effect here is positives for the company, positives for the political figures who they donate to, or who they arrange these contracts with. the people are losing out because all these costs get way inflated. is that a decent summarization of the net effect? mike: that is correct. odebrecht settled corruption charges in the united states, as they have big operations here, especially in miami. they admitted to paying $788 million in bribes across 12 different countries, mainly brazil, and even into africa, but in exchange, they received business work that delivered over $3 billion of profits. you can see, it is almost a four-to-one margin they got, and the people to pay for it, the people, pretty poor countries, because it sucked up money that could have been used for more
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positive things. carol: it sounds like the money also went all the way up in terms of the political structure in the country. this money, this bribery money also bankrolled campaigns for various presidents. mike: that's correct. a half dozen presidents in latin america, i think four or five former president of brazil, the executives of odebrecht claim in their testimony that they basically were bankrolling campaigns under the table, and also paying bribes to people under the presidents. in essence, they basically put the money up to get a lot of people elected, and once those people were elected, they got a lot of contracts. it was a calculated strategy that paid off until they were caught. carol: turning odebrecht's graft machine into a cover image was the work of creative director rob vargas. oliver: the cover story is an incredible wide-ranging cover story. how did you choose to represent such a dynamic story?
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rob: some of the men mentioned in the story are in prison. we had to come up with a concept. one of our art directors came up with this great concept where there was this iconography involved with bribery, which is pretty much like money in a yellow envelope. so we took that sort of approach, and wrote, just so it is abundantly clear, what this is about. carol: is it an actual manillay envelope you guys played with, and a picture of? rob: we went to staples, we splurged. we got some real envelopes. we had just ummy money, it has that silhouette. oliver: it took me a minute to figure out there with a silhouette of the cash inside. this feels like it communicates very quickly what this story is about. you see brazil, you see the
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envelope, it brings together points very quickly. rob: it is a nice thing to play with the surface of the cover, because the whole thing is the shape of an envelope. carol: you have a little explainer box on the side. do you like to do that? rob: we like to have fun with the way we do covers, but we always need that bit of information. carol: coming up, the two arab leaders behind the quarantine of qatar. oliver: and what good is a treasury department if you do not have a staff to run it? this is "bloomberg businessweek." ♪
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carol: welcome back to "bloomberg businessweek." oliver: the coordinated effort by saudi arabia, bahrain, egypt, and the uae to isolate qatar shocked markets this week.
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carol: and it ended up being the handiwork of two powerful arab leaders. reporter: we got a blockade, the cutting of diplomatic ties to qatar, by a handful of its arab-persian gulf neighbors. this is a relationship that has been fraught for years. qatar is a very small but wealthy country. 2 million people there, but they have the highest per capita wealth in the world. they are sitting on the cheapest, most abundant reserves of natural gas in the world. they are the biggest exporter of liquefied natural gas. they did not start producing and exporting until the mid-1990's, and until then, they were basically a vassal state of the saudis. but over the last two decades, they have established enough wealth and autonomy to start walking on their own, really, and developing an independent
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foreign-policy strategy that is not something the saudis and the egyptians are fans of. particularly their cozying up to, or perceived cozying up to, the iranians. oliver: there is a lot, as there is with any situation in the middle east, so many different angles here. there is the financial capability that qatar now has, fairly recently, allowing them to expand and have their own influence outside their nation. there is also deep-seated religious differences between sunni and shiite, as well as who is backing whom here. one of the most important relationships is the relationship between saudi arabia's crown prince and the head of the uae. tell us how that is influencing the situation. reporter: the statement that was put out announcing this blockade was not signed, and yet gulf
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experts kind of see the fingerprints of two people directly behind it, mainly the very powerful, very young deputy crown prince of saudi, and the de facto head of state of the uae, sheikh mohammed bin syed. when the king of saudi died in 2015, and king salman took over the throne and named his son as deputy crown prince, the uae was basically one of the first people to reach out to them. they have formed a pretty close relationship, and they have economic and political interests that really align around combating extremism, mainly shiite extremism, as they see iran is the chief sponsor of, so that has been the tie that binds. let us also remember that these
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are two entirely oil-dependent economies. they also have economic interests aligned with each other, and that is particularly important, as we have seen oil prices limited over the past four years. carol: staying in politics, the u.s. treasury department has a lot on its plate. oliver: but the agency right now is running on a skeleton staff. carol: let's set the stage here, because treasury secretary steven mnuchin has an awful lot of things on his plate. remind us of all the things he has been tasked with doing. reporter: the white house economic agenda, which mnuchin plays a very large role in, is to overhaul the tax code for the first time since the reagan administration. also to cut a lot of the financial regulations that the obama administration spent years putting in place with dodd-frank and other rules. he also has pledged to invest in infrastructure programs across
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the country, all of this is meant to boost growth, to 3% sustainable growth over the next couple of years. he says it will take about two years to get to this figure, considering we are right around the 2% point, and we have worked very hard just to get to 2%. jumping to 3% or above is quite a challenge. oliver: sounds like the treasury secretary could use some help. reporter: he does need the help of congress, for one thing. it is a republican-controlled congress. the white house needs to send coherent messages, to republican leaders, to what their legislative agenda should be. at the same time, you need a lot of personnel in the office, a deputy secretary, undersecretaries, and right now, he has none of those. he has four counselors who basically work as senior aides. to be fair, a lot of former administration, both republican and democratic, have relied on
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counselors for treasury, but there are supposed to be undersecretaries overseeing each of the three main units at treasury, domestic finance, international affairs, and terrorism and finance. none of those are filled. we have nominees for two of those that are stuck in the senate, and one has not been nominated. compared to the obama administration transition in 2009, trump is behind with the treasury department. he has not nominated nearly as many as obama had, and definitely not as many confirmed. you could say the same about comparisons to the w. bush administration. it is taking almost twice as long to get people through compared to bush. carol: he did have a choice as deputy, jim donovan. what happened to him? reporter: on may 19, he cited family reasons to step down from consideration, so we're back to square one. the problem is that jim donovan, a goldman sachs banker, was shouldering a lot of the management responsibilities that come with the treasury
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secretary, which is hiring and recruiting people. he had done a lot of the interviews for senior-level, mid-level, and senior staff members, political appointees in the building, and and now those people are not sure whether their job offers still hold, as their guy, the person they looked to for contact with the treasury, is now gone. oliver: up next, how companies from cisco to microsoft are quietly relying on lower-wage staffers with visas. ♪
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oliver: welcome back to "bloomberg businessweek." carol: you can listen to us on radio on sirius xm channel 119. 9091 fm in washington dc, and
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a.m. 960 in the bay area. carol: in the technology section, many h-1b visa applications for jobs at u.s. tech firms are not going for the mid-to high-level positions. oliver: they are actually going to entry-level jobs. joshua: it has been one of silicon valley's public policy priorities for a long time, and it creates a limited number of visas to bring workers with specialized skills into the country for three-year periods. silicon valley uses it to bring in computer scientists, programmers, and so on. you also see hospitals use it, and the thing that makes it controversial is, you see the outsourcing industry use it to bring in lower-level computer programmers at lower levels of pay, and this is what people are irked by. oliver: specialized workforce, and right now that specialization largely exists
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within the tech space. the h-1b visa is not necessarily new, but it has sort of proliferated through the text space most recently. joshua: the program has been around for several decades, and because it is something that is set up for technical skills by silicon valley, it is one of the heaviest users of it, just because they need specialized engineers. carol: a company like cisco, it allows them to do what? joshua: what you will see cisco say is, we need to hire master's-degree-level programmers, and we cannot find enough coming out of american universities. so let us bring some foreign-born engineers in, because these jobs will go unfilled otherwise. carol: that is the specialty skills. but it is beyond, they're using it for workers who do not necessarily have specialty skills, correct?
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joshua: right. what is new here is that, we have always known that there are companies, mostly companies from india, that are getting a lot of visas to hire modestly skilled tech workers to do rote back-office work. they do not make a lot of money by silicon valley standards. they are not terrible jobs, but they are not the kind of silicon valley jobs. these companies have become the villains of the h-1b program in many people's eyes, because they are taking a lot of the visas that would otherwise go to your phd's or whatever. but what is new here is that cisco, and pretty much every other silicon valley company, is subcontracting with the same companies to bring those same workers onto their headquarters to do kind of the lower-level computer work. oliver: so this is where the value of this story really excels. because this is something that has been in the spotlight, it
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has been an issue each back and forth from both political camps throughout the election, donald trump has targeted it, and you guys have access to some new data here. tell us where this came from, because people suspect this has been happening to a certain extent. the degree to which the way you guys have quantified it is new here. joshua: this has been something that many people who study the program have been aware of. here. obviously, people who work in silicon valley know about this, because they are at these companies, but it has been really hard to tell how much it goes on. so i was contacted by, basically, a hobbyist data analyst from south carolina. he works for an i.t. company, but he found his way to crunch the numbers -- oliver: a good data samaritan. joshua: what he found was that each h-1b visa application to
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the department of labor listed, here is where this person will work, an address. and he wrote software that scraped the department of labor's website and would hold down all of the visa applications, and sorted them by those addresses. so then you could say, 1 microsoft way is microsoft. but there is always other applications to work at that site, so therefore, these are contractors working for microsoft. oliver: in the focus on the cloud section, dropbox ceo drew houston talked about the company's dealing with the competition coming from google, amazon, and apple. carol: and its potential for an ipo. drew: dropbox invented this new -- it basically let you store your files on your computer in the cloud, and made it really easy to do so. it was very popular. they initially gave the service away for free, and then you could pay a little extra money as an individual to get a pro
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version. what happened was, google, apple, amazon, microsoft, everybody knocked this service off, and the nature of how the technology works, when google does something or apple does something, it is very easy for them to push people into that service. so all of a sudden, dropbox, who had this very nice funnel to get new users, gets kind of disrupted by the fact that google or apple will say, we will throw in some free storage with your gmail or whatever, and they will really encourage users to do that. that basically threw dropbox for a loop. carol: you have to think about google, that is a big market. drew: that is really where this business is. there are people out there who pay $100 a year to get their files on the cloud, but most of the money is from big companies making the deals, and the thing about corporate purchasing is, there are privacy things, a
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special procurement division, and companies that already know how to get into those, those big companies have a huge leg up. we saw a couple of years ago, box, which is very similar, but focused almost exclusively on selling to companies, went public, and that also created a problem. they were getting squeezed by box on the small end, and by the big companies on the big end. but what they do have, which is a huge advantage, is a lot of committed users, who were using it in college, started using it at work, and kind of convinced the i.t. buyers to buy the product. it is kind of the same dynamic at play with slab, but i think dropbox and slab are kind of in this category where you saw the consumer going towards enterprise. the wonks in this world call it the consumerization of the enterprise. oliver: up next, russia and china moving back into america's
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backyard. carol: and the one reason buzzfeed may need to break into tv. ♪
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oliver: welcome back to "bloomberg businessweek." carol: still in this issue, it what may have been a key reason for president trump pulling the u.s. out of the paris climate accords. and lessons from some of the world's most influential ceos. oliver: all that ahead, on "bloomberg businessweek." ♪ oliver: we're back with "bloomberg businessweek" editor-in-chief megan murray. let's start in the global economics section. really interesting story about this resurgence of russia, china, some of these powers
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dabbling in the caribbean. tell us about those. megan: this is something that is one of those geopolitical shifts which tells a much broader story of the climate we are in. as the u.s. refocuses its foreign policy, and more being directed inwards toward the u.s. and u.s. interests, countries like russia, china, are really looking at places like nicaragua, cuba, in that caribbean area, as a place where they can solidify their economic power and political power. with china, this is a lot about their economic interests. it is not dissimilar to what they have done in africa and other parts of the world, flexing their muscles to countries that need their access to resources to really build an economic power to them. on russia's side, it is a little bit more poking and trying to establish a little bit of a power base their that is really close to our shores, and that sort of tension is going to be
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fascinating to watch, given how quickly some of those countries are trying to move forward. carol: the u.s. is creating these opportunities. megan: absolutely, in the sense of our long-standing issues with cuba. obviously, we lifted the embargo and sanctions, but it is going to take an incredibly long time for cuba to recover, to make steps forward with its economy, and other countries are sniffing that opportunity there as well. one thing donald trump has done is refocus our foreign policy. he has been very clear that he is going to protect u.s. interests first. when you say publicly you are going to protect u.s. interests first, other countries are going to look at the vacuum that creates in other areas. for china in particular, creating this as another potential economic outreach for them is there significant move. carol: let's talk about the ongoing repercussions from president trump pulling out of the paris climate accords. the green fund, you guys dig into this. megan: this goes hand-in-hand with what we were just discussing in terms of, when you
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refocus your ambitions outside of the u.s., it is going to have an effect. the green fund has been used to give developing countries, the countries scientists think are going to be the most hard-hit by the changing climate, to encourage both for them to invest in projects that will make their climates more sustainable, to reduce their emissions, as well as to force wealthier countries to give developed countries money to fund those kinds of projects. in theory, it benefits us all in reducing emissions and holding everyone accountable for the world we live in. our retreat, and his signal that we will no longer contribute to it, is certainly going to have to -- have effects and who scientists say are going to be the hardest hit by climate exchange. oliver: finally, a really interesting story on buzzfeed. we're branching out into all kinds of stuff. carol: you know you read these lists. reporter: there is one they did with wrapping a balloon in papier-mache, when it is going
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to explode? we love experimentation at "businessweek." i am thrilled to see big media players taking a chance on upstart projects in video. they have got their fingers on something. millions of people are watching their videos, and this is a story that delves into the business behind crazy videos we are watching. carol: the wacky and business world of buzzfeed. reporter: buzzfeed is really one of the digital media darlings. they have really figured out how the internet works. their content is everywhere, they have a news operation, they produce a lot of video, and they are really good at distributing it on social media. facebook, youtube, snapchat, instagram. carol: those lists. gerry: they are known for their lists, their quizzes. these tasty videos, which are these sped-up recipe videos. they're everywhere on facebook. they are really an internet juggernaut.
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oliver: ceo jonah peretti has been there since the get-go. this is a company that has evolved quite a bit in terms of the content on its website. i remember when buzzfeed was shifting and hiring financial reporters to build out a business reporting part of the website, and that was a big deal. that is still there, but it seems like their focus has shifted much more. even in this story, we get about halfway before we start talking about news. this company looks very different than it did a couple of years ago i feel like. gerry: buzzfeed is 11 years old now, and just like a lot of digital media companies, they have shifted towards online video. what buzzfeed and a lot of online media companies realize now is that there is even more money if you take the online video and figure out a way to turn it into a 23-minute television show, or a two-hour movie. a lot of people talk about cord-cutting, and how tv is dead, but there is still an enormous amount of money in television advertising.
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that is what buzzfeed is going for. carol: in your story, you talk about the buzzfeed ceo, this convergence. kind of like old and new media, working back-and-forth. gerry: that is right. buzzfeed has received $400 million in investment from nbc-universal. nbc has also invested $200 million in vox media. we saw disney invest in maker studios. there has been this old media/new media romance going on a few years now, and buzzfeed is very much at the center of it. oliver: the millennials group right now, and in general, always the 18 to 34's, a very prized, targeted range for advertisers. as other companies decide how to shift their material for that group, i feel like buzzfeed is uniquely positioned, because they are the group. i do not think there is any debating that jonah peretti is a very smart guy, and is obviously leading the front on this. when you talk about the story about what the office looks like, it does sound just like a
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bunch of millennials run wild. kind of letting them do what they want. they had studios set up where they are playing games. carol: you went there, what was it like? gerry: i took a tour of their studio, and behind each door, it is like a willy wonka factory. you go behind one door, and there is two male employees who shake hands and start tickling each other. there is people filming that. there is people eating fried chicken, and all of a sudden they get surprised with a live, clucking chicken. this is very much buzzfeed's dna, just wacky, crazy, a little silly. but a lot of that stuff works really well on the internet. the question now is, do any of these sorts of ideas, can they be developed into television? oliver: up next, how israeli tv producers have become heavy hitters in exporting shows. carol: and europe's most famous singing competition, and what it tells us about the future of the continent. oliver: this is bloomberg. ♪
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♪ oliver: welcome back to "bloomberg businessweek." i am oliver renick. carol: and i am carol massar. in the companies and industries section, israeli tv networks have been successfully exporting concepts for shows. oliver: and now they want to start selling their productions across the globe. this is a very cool story about entertainment, and the influences that have changed israeli television. tell us about what is happening there right now. reporter: it is interesting, because israeli tv was like a lot of stuff in israel, not especially great for much of its history. it was kind of slapsticky and not very serious. and in the last 10 or 20 years, there has been a lot of changes in israel. has been an, they are increase in the digital parts of the economy, and it has spread to tv. what we are seeing here is, production houses doing very sophisticated shows, and they are being exported.
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originally, they were exported as ideas, so "homeland" is a classic example. it was done for israeli tv, and then they made a version in this country, which has been a huge success. carol: a favorite show of mine. ethan: an excellent show. carol: really well done. but that show in particular, i feel like, drew attention to what is going on in israel in terms of programming. and we are starting to see more come out. ethan: what is happening now is, in addition to "homeland"-like things happening, the current sort of hit, although not on the level of "homeland," is "fauda," which is an arabic word, which means chaos, and it is about an undercover israeli unit going after a hamas terrorist killer in the west bank. what is interesting about "fauda" is that it has been simply bought whole by netflix, and is shown here and around the world, where netflix can be seen
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in hebrew and arabic with subtitles. so unlike "homeland," which became an american-style thing, that is going on now more and more, shows that are a pure , local content are being made available abroad, and israel has become a factory of high-quality content. oliver: it seems that content is also very thematically geared towards the region as well. you point out that there are a few things that are very sort of mainstream. i feel like a lot of them do center around conflict, terrorism, spies. what is really interesting is "fauda" right now, which is basically a show that tackles both sides of the israeli-palestinian conflict, is this content that people want to watch, and that is what makes it successful? it is about the way this executed in terms of production value or are these things that everybody can relate to and watch? ethan: to some extent, nobody really knows the answer to that. what is interesting is that the company that made "fauda," when
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called yes, when it was first proposed to them, they said, nobody in israel wants to watch a program about the conflict. the conflict is not a particularly popular issue in israel. carol: and they are living it. ethan: to some extent, it is sort of walled off from them, what goes on in the west bank. they live their lives, and that is a more complicated political discussion. they are not especially focused on it, and the idea was that nobody really wants to watch a show about it. and it turned out to be the most-watched show in yes's history, which the about 50 years of making shows. oliver: speaking of television shows, eurovision draws more viewers than the super bowl. carol: and the european singing contest does more for the continent than crown the winner. here is reporter thomas rogers. thomas: eurovision is a song competition that is been around for just over 60 years. bystarted in 1956, organized
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european investors, with the goal of fostering european unity and spreading broadcasting technology. since then, it has become the largest, the most-watched non-sporting event in the world. about 200 million people watch it every year. oliver: wow. there are a ton of people turning into this. the unity part is what i am curious about, as there are a lot of vivid descriptions. you do a good job in the story, making it feel like i had watched this thing. you have crazy costumes, crazy songs. where does the unity aspect come from? tell us about the historical aspect. thomas: it is a competition. each of the countries are hoping to win ultimately, but it is sort of sheathed in this european unity ideal. every year, they have a slogan. this year, it was celebrate diversity. they very much sell it as a celebration of european identity, as opposed to one of national identity. but of course, national politics and geopolitical considerations
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always end up playing a role, so you see this really interesting tension between an event that supposedly celebrates european unity, but there are these national forces that tug it in different directions. carol: what is interesting, too, you include that it is the largest-non-sporting event in the world. you do say, it gets political, and even sometimes predicts geopolitical shifts. tell us specifically what you mean by that. thomas: some of the dynamics up feeding the brexit vote in the u.k. were in evidence in eurovision for a long time. the u.k. has often complained that continental countries, countries on the european continent, tend to vote for their neighbor countries, and that because the u.k. is an island, they are at a disadvantage. so there have been right-wing tabloids in the u.k. that called for the country to leave eurovision as early as 2008.
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turkey left the contest in 2013, which many saw as a kind of preview of its move away from europe and towards a more authoritarian, autocratic political system. then, germany has done very badly the last few years, and many people see that as a reflection of european anger about austerity policies. oliver: it is interesting to think about doing badly in an "american idol"-type contest. there is a lot of weight put into this. where does this leave us now, because you kind of hint that at this, what i think is very interesting, this is supposed to be about unity, identity, that is not always the way. but if you look at the geopolitical landscape right now, this is a time that is particularly nationalistic, where people are having tendencies to support their own countries, their own ideals. is it bleeding into the event in the most recent instance? thomas: this year's contest was partly overshadowed by the
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conflict between ukraine and russia. this year, the contest took place kiev, the capital of ukraine, which as you know, is at war with russia at the moment. russia is very interested in winning the contest, so they have done a number of things that parallel other strategies. geopolitically, the kremlin has been actively spreading false news about eurovision. they also sent a singer who was legally banned from entering ukraine, because she had performed in crimea shortly after the russian annexation. ukraine ended up ultimately not allowing the singer into the country, and therefore, russia did not take part in this year's eurovision, which caused a ruckus. oliver: coming up, the wild fuel the party that dating app badoo.
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carol: and some major execs share the secrets of their success with "bloomberg businessweek." ♪
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♪ carol: welcome back to "bloomberg businessweek." i am carol massar. oliver: i am oliver renick. you can catch us on the radio on sirius xm channel 119. a.m. 1200 in boston, 99.1 fm in washington, d.c., and a.m. 960 in the bay area. carol: and in asia on the bloomberg radio plus app. in the technology section, badoo is known as a tinder-style dating app. oliver: it is also known for the company's super-sexualized parties in london. here is our editor. app differsthis from the rest in the market. jeff: it is an app with about 60 million regular users, most prominently in russia. back home, at their headquarters
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in london, mostly what they are known for is ridiculous parties. oliver: corporate parties. jeff: yes, they are internal parties, for the most part, but they are also used for the company as a recruiting tool, headhunters and people who work for the company. carol: define ridiculous. oliver: don't hold back, jeff. jeff: what has come out, talking to a lot of former and current employees there, is that it is pretty common for the parties to be pretty overtly sexualized, and typically towards one direction. a common trope is for there to be half-naked women dressed as mermaids or in police or carnival costumes, or being, nearly nude models being used as sushi platters with food being eaten off them. carol: your typical corporate party. oliver: i don't know what question to pose after that. carol: what is the thinking behind doing these parties in this way? i know oliver is thinking this
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is the most interesting story, but why this approach? jeff: the ceo told reporters that the thinking is basically just to reward staffers, many of whom are young russian men, away from home for the first time, who are working hard on the app. what we heard from headhunters and people who have worked and currently work for the company, is mostly that it is used as something of a recruiting tool. it helps the app compete for talent with some better offers from people like facebook and google. carol: how do the women feel that work there? jeff: over the past year, these parties were happening about once a week at the end of 2015, and were $25,000 to $45,000. they were cut down to about once a month, and according to our reporting, the reason for that is that a series of complaints were levied at hr, mostly by women, who tended to leave the company afterwards. oliver: there is a lot of questions i have here about the
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money, the sort of trend that they are putting themselves in, the spotlight they are putting themselves in by doing this. let's start with the latter part because there have been a lot of high-profile sexual-harassment cases in tech companies. there have been instances within companies of these dating apps. there was a conflict between tinder and one of its co-founders, a female co-founder, who then left to start bumble, which is now partly owned by the folks at badoo. there is a lot of interesting things happening. you have also heard about uber announcing they laid off off employees due to sexual harassment claims. badoo, it seems like they are playing with fire here. jeff: a really curious thing about this story here is at a time when at least some silicon valley firms are feeling chastened about their typically retrograde attitudes towards women, and trying to make at least possibly good-faith efforts to change things, this is a company that is very much kind of leaning into a boys'-club notion.
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oliver: in the etc. section, a compilation of all the life lessons from the companies "how section "how did i get here?" carol: you had one reporter in particular who has often talked to the ceos about how they got to that top spot. reporter: our back page is called "how did i get here?" we have done more than 100 of these pages, interviewing more than 100 chief executives, and have walked away with a lot of wisdom having done that. the first thing she says is, basically, rule number one is, getting time with these people is really hard. you have assistants whose job it is to make sure you do not get on the calendar, and then people like publicists who want you on the calendar, but do not want you on the calendar for six months, and then it is at 8:14 a.m., and then they cancel on you the day before. oliver: so when you guys had
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ve this in the back of the magazine, there are a lot of people that say we want to get in the magazine. how did you guys decide which ceos you wanted to interview? was it about availability, or did you try to find people in offbeat industries, or up-and-coming individuals? ed a mix.want to th part of this is getting names on this page you are going to recognize. one we did recently was papa john schnatter, a fascinating story. we did guy fieri, one of my personal favorites. oliver: flavor town. bret: you are looking for a mix, but you are also looking for people who are not necessarily ceos in the traditional sense, sitting in a corner office. you're looking for people who got their hands dirty, and some of the people we interviewed who had the best stories were chefs. klaus meyer, for example, culinary entrepreneurs. they have wonderful stories of passed-out chefs on opening night. we love talking to comedians. we talked to margaret cho, marc maron. why?
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because they're funny. [laughter] carol: i bet. is there anything she came away with? she talked to men ceos, women ceos. anything she came away with on how to get to be a ceo? number one, you have to wake up really early. anyone can be a ceo, as long as you're willing to basically get up -- if you like getting up at 3:00 a.m., you're are probably primed to be a ceo. many of them do their best work between 3:00 and 6:00. what she did find is that basically a lot of the people who are ceos today have been working for 30 years, knew smart, driven, motivated people who one day picked up the phone and said, i have known you for 30 years, i trust you, do you want to be ceo of my company? oliver: you hear a lot about the maneuvering that has to go on, in the corporate hierarchy, at the end of the day, her honest takeaway was, just wait and surround yourselves with good
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people, which seems to be advice consistent among all the ceos. bret: that is right. stick it out, persevere, make friends. this is one of the rules she found in talking to people. you cannot do this alone. you are never going to get to the top without making a ton of friends, so all the people really in the corner offices have done a really good job of that. carol: "bloomberg businessweek" is available on newsstands now. oliver: and also online at lots of good stories in this issue. where you able to pick your favorite? carol: it was the global economics story having to do with moscow and china moving into cuba, emerging nations, the caribbean nations. china is doing it for economic reasons. for russia, it may be a little more politically motivated. but this is happening as the u.s. steps back. how about you? oliver: i am going to go with joshua brustein's look at the h-1b visa program. they have been doing a great job covering it, a very heated political debate. there is some excellent data-mining here.
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they were able to go back, and figure what it is being used for. it makes the situation a lot more nuanced. more bloomberg television starts right now. ♪
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♪ coming up on "bloomberg best," it is business around the world. britain goes to the polls again. the ecb says no more rate cuts are coming. high drama continues on capitol hill. >> i do not think it is for me to say the conversation i had with the president was an effort to obstruct. >> this is reality tv. this is not a serious investigation yet. michael: apple hopes they will have another home run. strategic inside into their strategy. >> we wanted in


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